Monday , February 6 2023

Thai coffee chain Café Amazon struggles to expand in Vietnam


Thai coffee chain Café Amazon, which entered Vietnam two years ago, has been slow in expanding due to intense competition and the Covid-19 pandemic stymieing its plans.

With 15 outlets mostly in Ho Chi Minh City and some southern localities, it remains a world away from its biggest competitor, Highlands Coffee, which has 573 across the country.

Café Amazon hopes to have 20 stores by the end of this year, none in the north.

Other competitors The Coffee House has 153 stores, Phuc Long has 118 stores and 1,062 kiosks and small outlets and Trung Nguyen Legend has 95 stores and 572 E-Coffee outlets.

In contrast, in Thailand, Café Amazon had over 3,400 stores as of mid-2021.

“Everyone knows the Vietnam food and beverage market is difficult and so we are in the process of opening new stores while researching into Vietnamese consumption habits,” A-Tathak Srinon, marketing director of Café Amazon Vietnam, said.

The Vietnam operation is 60% owned by Thai state-owned oil and gas firm PTT Public Company Ltd and 40% by retail giant Central Group.

Its first store opened in the southern province of Ben Tre in October 2020, followed soon after in two other southern localities.

But with Covid raging in 2021, restrictions were in place year-long, which included F&B businesses having to close for months.

Besides, it has been unable to open coffee shops at gas stations, a strategy that has underpinned its success in Thailand, where most of its outlets are in PTT Oil fuel stations.

Srinon said Vietnamese gas stations are smaller than in Thailand and not suitable for setting up coffee shops.

The chain is therefore is focusing on its menu to distinguish itself from other competitors, he said.

Last week it launched three new drinks with a distinctly Thai taste, including one called Tom Yum Ice Tea.

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